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Top 15 stocks since Brexit vote
By David Brenchley | Fri, 23rd June 2017 - 16:32
A year is a long time both in politics and the City, and it certainly has been an eventful 12 months since Britain voted to leave the European Union on 23 June 2016. Yes, share prices plummeted in the aftermath, but then followed one of the most incredible rallies in stockmarket history.
We now have a new prime minister, albeit with a greatly reduced majority, and negotiations around our withdrawal from the EU are underway. It's early days, but time taken for Theresa May to agree a deal with the Democratic Unionists is hardly comforting.
European elections went rather more smoothly, although across the Atlantic Donald Trump got elected to the White House - the real Big Orange also upset the odds to win the Gold Cup at Royal Ascot this week.
Through all this, stockmarkets worldwide have been buoyant. Initially, the FTSE 100 (UKX) slumped 9% on the Brexit decision, but by the following Wednesday had fully recovered losses.
In fact, the blue-chip index - at 7,443 at time of writing - is over 17% higher than it was on 23 June last year, before we knew the result, which most expected to go to the 'Remain' camp. Thank a slump in sterling from $1.50 to a 30-year low near $1.19 for that.
The more domestically oriented FTSE 250, on the other hand, fell harder – down 14% by 27 June as a weaker pound increases import costs – and took longer to recover. However, it was back at pre-referendum levels by 5 August, and it continued to fly. It's trading near record highs now and is up 14% from the close 12 months ago.
As we mark the anniversary of the 'Leave' vote, we thought it would be interesting to look at the best-performing stocks since close of play on 23 June 2016.
Most of the best performers are now trading at record or multi-year share price highs, showing the initial fall across the board was hideously overdone.
Some sectoral themes emerged, with miners clear winners. Glencore (GLEN) (up 84%), Ferrexpo (FXPO) (490%) and SolGold (SOLG) (1,200%) have been stunning performers on the FTSE 100, FTSE 250 and AIM All-Share respectively, while Antofagasta (ANTO) (76%), KAZ Minerals (KAZ) (240%) and Bellzone (BZM) (1,000%) are close behind.
By the Monday after the vote, Glencore had slipped 12%, but was a bottom for the stock and it went on to hit a two-and-a-half-year high in February. It's drifted since, but broker Investec reckons it can get back above 350p, tipping it to go 26% higher from here.
Best-performing FTSE 100 shares since Brexit vote
|Rank||Company||Ticker||Market cap (£bn)||Price (p)||Performance (%)||Forward PE||Forward yield|
|4||Coca Cola HBC||CCH||8.6||2,397||70||26.1||1.7|
Best-performing FTSE 250 shares since Brexit vote
|Rank||Company||Ticker||Market cap (£bn)||Price (p)||Performance (%)||Forward PE||Forward yield (%)|
Best-performing AIM shares since Brexit vote
|Rank||Company||Ticker||Market cap (£m)||Price (p)||Performance (%)|
|Source: Sharepad (23/06/2016-22/06/2017)|
At the opposite end of the scale, financial services firms are among the worst performers, while more recently the general retailers have had a tough time of it due to the culmination of rising inflation and weak wage growth affecting retail sales. DFS Furniture (DFS) has already crashed after warning on profits.
DFS's furniture-selling peer Dunelm (DNLM) (-37%) has had a nightmare, though, while Pets at Home (PETS) is down 41% and high-street bellwether Next (NXT) the second worst-performing blue chip, down 28%. Only BT (BT.A) at -36% beats it.
One sector that has a noted diversion in performance is the support services sector. G4S (GFS) has recovered from a shocking 2015 to post gains of 84% since the referendum, putting it level with Glencore as the best FTSE 100 performer. Rentokil Initial (RTO), Ashtead (AHT) and Electrocomponents (ECM) just miss out on the top five in their respective indices.
And analysts at Barclays thinks there will be even more divergence from the sector peers' performance in the coming weeks and months as the outcome of the general election hits each in different ways. G4S is much less sensitive to political oscillations than the likes of Capita, Serco (SRP) and Mitie (MTO), the broker says.
G4S initially plummeted 20% on the Brexit result, but finished on the Friday just 4% down. It's more than recovered since, and sits at a 21st century high.
On the other hand, it's a well-documented fact that another Woodford favourite, Capita (CPI), has struggled (-36%) since the referendum. However, it would have been much worse for the outsourcer had it not staged a recovery from December's 11-year low.
While Barclays worries about Capita's vulnerability to political uncertainty - half its revenues are derived from the UK - it's reversed incredibly since the profits warning and is now two-thirds higher at a shade under £7.
As Brexit negotiations begin and Theresa May clings to power, and as investors get jittery over generous stock valuations, it'll be interesting to see how many of these winners hang onto gains. As always, quality will always shine through.
This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
|PETS AT HOME GROUP||181.30p||-0.87%|
|All data 15min delayed as of: 00:23:50 21/10/17|